Quick Take Europe

Global Market Quick Take: Europe – 14 November 2024

Macro 3 minutes to read
Saxo Be Invested
Saxo Strategy Team

Key points:

  • Equities: U.S. equities steady; Rivian surges on VW investment news.
  • Volatility: Volatility eases with lower expected index moves; markets await Fed Chair Powell’s speech.
  • Currencies: USD strength continues across the board.
  • Commodities: Gold slide towards next key area of support; Crude on hold with focus on IEA
  • Fixed Income: U.S. Treasury curve steepens sharply on fed rate cut hopes and Trump trade bets.
  • Macro events: US Oct. PPI, US Weekly Jobless Claims, US Fed Chair Powell speaks

The Saxo Quick Take is a short, distilled opinion on financial markets with references to key news and events.

Macro data and headlines:

  • Australia Oct. Employment Change out at +15.9k vs. +25k expected, with the unemployment rate steady at 4.1% as expected
  • US Oct. CPI was exactly in line with expectations, posting a rise of 0.2% MoM and +2.6% YoY for the headline and core Ex Food and Energy at 0.3%/3.3%
  • UK Oct. RICS House Price Balance, a measure of UK house prices, rose to highest level since 2022 at +16% versus +11% expected and +11% in Sep.
  • The US Federal Government Budget Balance slipped to USD -257.5B vs. -232.5B expected

Macro events (times in GMT) IEA’s Monthly Oil Market report (1000), ECB Meeting Minutes (1230),  US Oct. PPI (1330), US Weekly Initial Jobless Claims (1330), EIA’s natural gas storage change (1530), EIA’s weekly crude and fuel stock report (1600), Mexico’s Central Bank Rate Announcement (1900), US Fed Chair Powell to speak (2000), UK Bank of England’s Bailey to speak (2100)

Earnings events:

  • Today: Siemens, Deutsche Telekom, Disney, Applied Materials,
  • Friday: Alibaba

For all macro, earnings, and dividend events check Saxo’s calendar.

Equities:

  • US: The S&P 500 closed flat after the latest CPI report met expectations, maintaining optimism but signaling a pause in the post-election rally. Rivian’s shares surged 13.6% as Volkswagen increased its planned investment to $5.8 billion. SMCI declined another 6.4% following its delayed earnings report, extending its downtrend since a critical report from Hindenburg Research.
  • Asia: Most Asian stocks traded lower on Thursday as markets showed caution following the U.S. inflation report and awaited further clarity on stimulus from China. Chinese equities showed minimal movement, with the CSI 300 and Shanghai Composite each down 0.2%. Hong Kong’s Hang Seng Index dropped 0.8%, pressured by concerns over a potential tough U.S. trade stance under the Trump administration. Tencent rose 1.2% following strong Q3 earnings, but overall sentiment remained subdued.
  • Europe: European stocks saw modest declines with the STOXX 50 and STOXX 600 both down about 0.1%, marking three-month lows as traders assessed the latest political and economic factors, including Trump’s potential China-critical appointees and ongoing challenges in Germany’s political scene. In corporate news, RWE surged 6.1% after announcing a share buyback, and Siemens Energy gained 18.9% following an upbeat mid-term outlook.

Volatility: Volatility remains subdued as markets digest recent CPI data, which came in line with expectations, reducing immediate inflation concerns. Options activity remains robust in high-profile names like Tesla, Nvidia, and Amazon, but implied volatility for these stocks is stabilizing. Lower expected moves across major indices further reflect a cautious yet steady outlook. Markets are now watching for insights from Fed Chair Powell’s speech later today, which could influence sentiment and volatility depending on any hints toward future rate policy.

Fixed Income: The U.S. Treasury yield curve steepened significantly on Wednesday as October CPI data strengthened expectations for a December Fed rate cut. Front-end yields dropped, while long-term yields rose, pushing the 5s30s spread to its largest one-day increase this year. Although Treasuries initially rallied on the CPI data, gains faded as stocks recovered. By the end of the day, markets were pricing in around 20 basis points of rate cuts for December. European sovereign bonds fell, led by Bunds as real yields rose on renewed Trump trade bets while ECB rate-cut expectations remained steady.

Commodities: Gold slipped again as a continued rise in US yields and a stronger US dollar saps interest while forcing long-liquidation. The next levels lower are USD 2,500 and 2475-2485, which was a major zone of price resistance on the way up. Silver, meanwhile, has slipped below the psychologically significant USD 30 per ounce level, weighed doubly by slipping copper prices. The next level of note there is perhaps the 200-day moving average at 28.67. Crude oil remains in a holding pattern with focus on IEA’s monthly forecast for global demand.

Currencies: The US dollar powered stronger after an indifferent US October CPI release yesterday that offered no fresh surprises. The move was accompanied by long US treasury yields rising back toward the recent highs. USDJPY notched fresh local highs over 156.00 and EURUSD dropped below 1.0550, posting new lows for 2024. The range low since late 2022 was the 2023 low of 1.0448. US Fed Chair Powell will speak late today.

 For a global look at markets – go to Inspiration.

Quarterly Outlook

01 /

  • Fixed Income Outlook: Bonds Hit Reset. A New Equilibrium Emerges

    Quarterly Outlook

    Fixed Income Outlook: Bonds Hit Reset. A New Equilibrium Emerges

    Althea Spinozzi

    Head of Fixed Income Strategy

  • Equity Outlook: Will lower rates lift all boats in equities?

    Quarterly Outlook

    Equity Outlook: Will lower rates lift all boats in equities?

    Peter Garnry

    Chief Investment Strategist

    After a period of historically high equity index concentration driven by the 'Magnificent Seven' sto...
  • FX Outlook: USD in limbo amid political and policy jitters

    Quarterly Outlook

    FX Outlook: USD in limbo amid political and policy jitters

    Charu Chanana

    Chief Investment Strategist

    As we enter the final quarter of 2024, currency markets are set for heightened turbulence due to US ...
  • Macro Outlook: The US rate cut cycle has begun

    Quarterly Outlook

    Macro Outlook: The US rate cut cycle has begun

    Peter Garnry

    Chief Investment Strategist

    The Fed started the US rate cut cycle in Q3 and in this macro outlook we will explore how the rate c...
  • Commodity Outlook: Gold and silver continue to shine bright

    Quarterly Outlook

    Commodity Outlook: Gold and silver continue to shine bright

    Ole Hansen

    Head of Commodity Strategy

  • FX: Risk-on currencies to surge against havens

    Quarterly Outlook

    FX: Risk-on currencies to surge against havens

    Charu Chanana

    Chief Investment Strategist

    Explore the outlook for USD, AUD, NZD, and EM carry trades as risk-on currencies are set to outperfo...
  • Equities: Are we blowing bubbles again

    Quarterly Outlook

    Equities: Are we blowing bubbles again

    Peter Garnry

    Chief Investment Strategist

    Explore key trends and opportunities in European equities and electrification theme as market dynami...
  • Macro: Sandcastle economics

    Quarterly Outlook

    Macro: Sandcastle economics

    Peter Garnry

    Chief Investment Strategist

    Explore the "two-lane economy," European equities, energy commodities, and the impact of US fiscal p...
  • Bonds: What to do until inflation stabilises

    Quarterly Outlook

    Bonds: What to do until inflation stabilises

    Althea Spinozzi

    Head of Fixed Income Strategy

    Discover strategies for managing bonds as US and European yields remain rangebound due to uncertain ...
  • Commodities: Energy and grains in focus as metals pause

    Quarterly Outlook

    Commodities: Energy and grains in focus as metals pause

    Ole Hansen

    Head of Commodity Strategy

    Energy and grains to shine as metals pause. Discover key trends and market drivers for commodities i...

Disclaimer

The Saxo Bank Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website. This content is not intended to and does not change or expand on the execution-only service. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.

Please read our disclaimers:
Notification on Non-Independent Investment Research (https://www.home.saxo/legal/niird/notification)
Full disclaimer (https://www.home.saxo/legal/disclaimer/saxo-disclaimer)

Saxo Bank A/S (Headquarters)
Philip Heymans Alle 15
2900
Hellerup
Denmark

Contact Saxo

Select region

International
International

Trade responsibly
All trading carries risk. Read more. To help you understand the risks involved we have put together a series of Key Information Documents (KIDs) highlighting the risks and rewards related to each product. Read more

This website can be accessed worldwide however the information on the website is related to Saxo Bank A/S and is not specific to any entity of Saxo Bank Group. All clients will directly engage with Saxo Bank A/S and all client agreements will be entered into with Saxo Bank A/S and thus governed by Danish Law.

Apple and the Apple logo are trademarks of Apple Inc, registered in the US and other countries and regions. App Store is a service mark of Apple Inc. Google Play and the Google Play logo are trademarks of Google LLC.